Try to reset the password over the Homepage and used only letters and numbers?
I had the same problem yesterday. The 'Authorise Computer' command was greyed out and inactive in the drop down menu. In the end, through looking at other replies on this forum, I right clicked on the ADE entry in the list of programs and clicked 'Run as Administrator'. Since then I have been able to authorise both my laptop and my Kobo and have managed to borrow a library book and transfer it to the Kobo. I'm not 100 per cent sure, as I was trying lots of different things, but I may also have changed the Installation of ADE to 'Run as Administrator' as well.